> 3) this behavior on the part of American tech would undermine their credibility globally. Wouldn't you reasonably be very skeptical of Microsoft if you were a foreign government if you knew they were actively working with the American government to pwn you?

The fact that foreign governments aren't more skeptical of Microsoft really baffles me. The American government isn't dumb enough to buy security products from Kapersky after all, or devices from Huawei.